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    Costs - Fixed or Indemnity Costs Part 36 Offers

    Lord Justice Jackson has called for costs to be fixed in all claims up to £250,000 in value.

    A recent case of (1) Broadhurst (2) Taylor v (1) Tan (2) Smith [2016] EWCA Civ 94 handed down judgment which deals with the limits of fixed costs and a very important point regarding their inter-play with Part 36 Offers.

    The case is a confined case which deals with Road Traffic Accidents that started under the Pre-Action Protocol for Low Value Personal Injury Claims in Road Traffic Accidents before exiting the MOJ Portal.

    Lord Dyson in the Court of Appeal last month now entitles a claimant to Indemnity costs even when they already fall under fixed fee regime. The main issue for Lord Dyson was whether Part 36 rules should overrule fixed costs where a Claimant secures more at trial than they had offered to settle for. Lord Dyson in this case concluded that it should.

    As the CPR Rules on Part 36 offers; a claimant who obtains a judgment that is more advantageous than their Part 36 CPR 36.14 comes into play.

    However, since the cases fell out of the MOJ Portal, costs should be assessed in line with CPR 45.29B;

    ‘if, in a claim started under the RTA Protocol, the Claim Notification Form is submitted on or after 31st July 2013, the only costs allowed are—

    (a) the fixed costs in rule 45.29C;

    (b) disbursements in accordance with rule 45.29I.'

    Lord Dyson in his decision wanted to keep in line with the spirit of the policy behind Part 36 by providing claimants with ‘generous incentives to make offers an defendants with countervail-ing incentives to accept them’

    Lord Dyson stated in his judgment that

    ‘where a claimant makes a successful Part 36 Offer in a section IIIA was, he will be awarded fixed costs to the last staging point provided by CPR rule 45.29C and Table 6B. He will then be awarded costs to be assessed on the indemnity basis in ad-dition from the date that the offer becomes effective.’

    In light of the decision by Lord Dyson, this is a very important. It seems that the Courts are now giving incentives to Claimant’s to make an early Part 36 offer in all cases and put increased pressure on defendant’s to give real consideration to accepting the same.


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